New changes to the Skilled Worker visa route

The Home Office has introduced changes to the Skilled Worker route, effective from 9 April 2025. We outline these key changes below.

Increased visa and sponsorship fees

New salary calculation rules 

The following payments will now be subtracted from a Skilled Worker’s salary and considered when calculating if they meet the minimum salary threshold for their role:

• deductions from salary or repayment of loans for immigration costs or business costs; and
• investments made by a worker into their sponsoring employer.

Standard deductions for benefits that workers have the option to take up, such as salary sacrifice arrangements, will not be considered – it will be limited to just those relating to business or immigration costs. There is, however, no definition of “business costs” or “immigration costs” in the new rules or guidance.

It is common for sponsors to pay a worker’s visa fees or relocation costs upfront and then recover these costs from the worker through salary deductions over the course of their employment. The Home Office have confirmed to us that “immigration costs” in the context of this new rule encompass these fees that normally fall to migrants to cover, such as visa application fees and immigration health surcharge payments. Sponsor-side costs associated with assignation of a certificate of sponsorship and the immigration skills charge cannot be passed on to workers.

Any repayment scheme for immigration costs will now be subtracted from salary and the subtraction will be averaged over the length of sponsorship. The salary after subtraction must still then meet the salary requirement defined by the relevant occupation code.

Example

The minimum salary threshold for mechanical engineers is £42,500.

An employer sponsors a mechanical engineer for two years and pays £5,000 towards their visa fees, which they intend to recover through salary deductions. They intend to pay the engineer a salary of £42,500.

For visa purposes, the £5,000 loan is averaged over the two-year period of sponsorship and then subtracted from the engineer’s salary, leaving them with a salary of £40,000.

The engineer’s salary must be increased by £2,500 to £45,000 in order to ultimately meet the £42,500 threshold needed to be eligible for Skilled Worker sponsorship. 

What constitutes “business costs" is more unclear. Does this include repayments for training costs or equipment for work? It is hoped that the Home Office will make further clarifications on these questions in the coming weeks, but for now it is best to err on the side of caution and assume these costs are included.

The new rules on deductions for investments have also made self-sponsorship more difficult. Investments that a self-sponsored worker make into their own business will now be subtracted from the salary they pay them self.

Example

The minimum salary threshold for a CEO is £84,100.

An entrepreneur starts their own company and intends to sponsor them self as the business’ CEO. Their business will pay them a salary of £100,000 and sponsor them for five years.

However, they also invest £500,000 in the business to help with start-up costs. Under the new rules, this £500,000 investment is averaged over the five-year period of sponsorship and subtracted from their salary.

Their salary of £100,000 becomes £0, and they need to increase their salary by £84,100 to meet the threshold for Skilled Worker sponsorship.

Changes affecting the care industry

Increased salary thresholds for health and care workers

The minimum salary that must be paid to all health and care workers has been increased to £25,000 per year and £12.82 per hour, up from £23,200 per year and £11.90 per hour.

All health and care workers making new applications from 9 April 2025 must be paid at least £25,000 per year, regardless of whether they are applying for a role at a new sponsor, extending their permission with their current sponsor, or applying for settlement.

Workers who are currently sponsored are not affected and do not require an immediate salary increase, but they will be affected when making new applications in the future. There are no transitional provisions in place for these workers already on the Skilled Worker route prior to the changes.

This will primarily affect care workers, care assistants, and Band 3 healthcare professionals outside of Scotland where the national pay scale is currently set below £25,000. Sponsors who do not currently pay these workers above £25,000 will be faced with difficult decisions when existing sponsored workers need to apply for visa extensions or settlement.

New recruitment requirements for care sector sponsors in England

In the last three years, almost 500 sponsor licenses have been revoked in the care sector, resulting in large pools of displaced overseas care workers who have been affected by non-compliant sponsors losing their licenses. In response, the government has established 15 regional and sub-regional partnerships across England to support displaced workers. A full list and contact details for each partnership can be found on the GOV.UK website here.

Under the new rules, employers sponsoring care workers or senior care workers must now first engage with their regional or sub-regional partnership and consider candidates from the displaced worker pool. These displaced workers will be given priority for new positions before employers in England can recruit from abroad.

If a sponsor is unsuccessful in recruiting from the pool, they can only recruit from overseas if they provide confirmation from the relevant regional or sub-regional partnership that this recruitment was attempted.

This change also applies to sponsorship of care workers applying from another route in-country, unless they have already been working for the sponsor as a care worker for at least three months.

This change does not currently affect sponsors in Scotland, Wales, or Northern Ireland.